Boehringer sees rapid growth

Boehringer Ingelheim's performance in 2004 was more than satisfactory thanks to a 50 per cent leap in operating income and a successful US product launch.

Privately-held German drug maker, Boehringer Ingelheim (BI), told reporters that its performance in 2004 was more than satisfactory thanks to a 50 per cent leap in operating income and a successful US product launch. Chief executive, Dr Alessandro Banchi, said that the company's strong growth would support its aspirations of future independence.

BI's sales rose by 10.5 per cent to Ä8.2bn in 2004, compared to a drop of 3 per cent to Ä7.4bn in 2003, taking into account exchange rate effects. Operating income jumped by more than 50 per cent to just under Ä1.4bn, driven by the welcome increase in sales, which has seen the firm outpace overall market growth for its fifth consecutive year. The company also posted substantial growth for its US prescriptions business at nearly 23 per cent, comfortably outpacing the US market, which grew by just eight per cent.

ìWe are very satisfied with the business year 2004,î said Dr Banchi, CEO and chairman of marketing and sales, at BI's annual conference held at the Ingelheim Centre in Germany last week. ìWe have taken another major step forward in the last financial year. In terms of profitability, the company is joining the leading group of international pharmaceutical companies.î

The company's best sellers continued to push up global sales figures. Alna/Flomax, for the treatment of benign prostatic hyperplasia, generated sales of Ä740m, while Mobic, a drug for rheumatoid arthritis, took second place with a 44 per cent increase in sales to Ä670m. This hike was due in large part to the withdrawal of Merck's Vioxx in September last year, with Mobic stepping in to part fill the gap.

Spiriva, discovered and developed by BI for chronic obstructive pulmonary disease, and co-marketed worldwide with Pfizer, is one of the firm's biggest hopes. The product saw a surge in sales of 130 per cent (to Ä525m) on the previous year's performance. BI hopes to see the drug ìpass the $1bn mark this yearî to achieve blockbuster status.

Difficult German environment

Yet, despite the positive reports, the German firm's net sales were hindered by the intensified political climate in the country, following disputes between pharma companies and the government over reference pricing and healthcare contributions.

Professor Marbod Muff, head of BI's corporate board divisions finance and human resources, noted: ìWe had to hand over Ä55m to national health insurance due to pharma-political decisions,î adding that such influences were to blame for the declining attractiveness of Germany as a location for the research-based pharmaceutical industry.

ìThose responsible must clearly recognise that healthcare policy in Germany is sending extremely negative signals to our industryÖ a continued policy of this type will drive activities out of Germany.î

An independent future

In an exclusive interview, Dr Banchi told Pharmaceutical Marketing that the company has no plans for any further co-marketing or similar deals in the future, underlining his commitment to achieving independence for the privately-owned firm.

He looks back at the period of co-marketing deals as a crucial time when they were able to learn from larger corporations and then use that knowledge to improve the company.

ìWhen we developed Spiriva and realised the potential of the drug, we also realised that we were not strong enough to make the drug accessible to patients, and from a marketing position, we wanted to learn how to structure a global marketing approach. All the things we have learned have made us a much stronger company.î

However, he adds: ìWe can do more and achieve more.î Aside from the existing co-marketing deals, his vision for the future of Boehringer does not include other parties in this respect.

ì[From] now, we are a different company. We are independent and when we go it alone, it means that we have options.î

He's very clear on the strengths of the company, which, according to figures from IMS, is currently achieving the second highest level of growth in the top 20 international pharmaceutical companies. It was voted as one of the top 50 Sunday Times' Best Companies to Work for in the UK.

ìWe consider our employees our most valuable asset. Their commitment and effort take the company forward. What we do well, I believe, is to communicate our strategy clearly to everyone. We are sincere, trustworthy and believe in diversity and richness within the workplace.î

Summing up, Dr Banchi noted with optimism that ìgrowth is expected to be higher than the market average this year and growth in net sales should be in double figuresî. In a final statement he added: ìWe will continue in 2005 along our successful path towards a sustainable growth.î